Time for Nigeria’s Private Sector to Get into BOP

klausimas: Going by the well known predicaments of the private sector in Nigeria, in line with your propagation thus far (about Bottom of the pyramid or BoP, markets for poor or inclusive market), is it not time for this sector to adopt what’s happening elsewhere – Evolving business models that suit this concept, as respite? Please assist with education on what an interested entrepreneur should expect – M. Ibrahim

As a way of helping out, a typical Nigerian entrepreneur should consider what is contained here, as hints towards venturing into Bottom of the pyramid (MB) marketing, markets for poor or inclusive business, from a Nigerian perspective. No time is more auspicious than now for the private sector here to get into this area which is fast gaining ground globally. The following is an excerpt of my much earlier piece in the series of articles aimed at trying to raise awareness about how doing business with the poor can be good for poor people and also good for business through this concept, titled, Making bottom of the pyramid marketing work in Nigeria:

Time for Nigeria’s Private Sector to Get into BOP

“In consonance with what I have been propagating all this while, a recent report of the National Bureau of Statistics (NBS) has it that about 113 million of the estimated 160 million Nigerians live in poverty – under $1 per day. Among so much contained therein, the North East and North West geo-political zones of the country recorded the highest poverty rates with 77.7 percent and 76.3 percent respectively, o 90% of the population of Sokoto state was classified as poor. Going by the activities of Boko Haram (the Islamic terrorist group) in mainly these areas, one can easily decipher the link between level of poverty and insecurity. tai, and incidence of insecurity in many other parts of Nigeria, comprise a major reason why the government should not rest on it oars towards stemming this embarrassing upsurge in poverty level, while the country’s economy is growing. My ‘preaching’ on giving attention to markets for poor (M4P) or Bottom of the pyramid (MB) marketing is indeed very relevant at this time.”

Another from that titled, “Any Nigeria’s self-exclusion from inclusive markets?” bears this: “…I had similar concern about Nigeria being conspicuously out of the global picture, after going through several publications. It was glaring that related activities were focused more on countries in south and south-east Asia (with India and its 600 million poor standing out); then South America. Within Africa, South Africa provides platforms for related business models, as well as some other countries in southern Africa. There is hardly any thing Nigerian-related, as business models application, in publications and other materials on this subject.”

These are pointers to the need for the Nigerian government to commence giving serious considerations to BoP related issues, as part of the much chorused “efforts aimed at alleviating poverty”. While one hopefully looks forward to a “shift of gear’’ on the part of government, this question seems to be glued to my mindWhat about the private sector in Nigeria?

It is no longer news that the private sector in Nigeria, especially enterprises involved in manufacturing, seems to be taking a bashing. Without reeling out the numerous problems which give one cause not to envy ventures in this sector at this time – a period when we are informed of an impressive 7.68 percent Gross Domestic Product (GDP) growth rate, but we know that manufacturing capacity is as low as 30 percent, with other parameters of growth nowhere near this GDP rating; poverty figure climbed from 15 percent in the 1960s, ir 54 percent by 2004, to almost 70 percent presently. To me, this epitomises spurious economic growth while poverty stares us all in the face.

As private sector concerns mainly in the Americas (US, Canada especially) and Europe have become awakened to the realization that businesses can also benefit from alleviating poverty through innovative business models that could bring ‘goodies’ to the poor, the same sector in Nigeria should go a step further (from typical corporate social responsibility efforts, and selling cheap goods to the poor) to deriving excess production capacities and seeking growth opportunities which abound in these markets, where the poor constitute essential parts of the value chain. The private sector in Nigeria should shift from resting on its oars at these challenging times, to imbibing ingenuity (especially preparedness to ‘think out of the box’) – Shift into inclusive market.

Who says looking in the direction of BoP (though a fairly uncharted area in the country presently) will not provide a desired succour? This piece, hopefully, will aid ventures in Nigeria contemplating ‘taking a plunge’ into evolving business models for BoP, through hints on how-to-get-it-right. This is without delving into details of steps and strategies applicable, as one is mindful of space constraints. What remains vital is a Nigerian entrepreneur’s realisation that this concept, as a market creation approach to development, embodies stra­tegy which combines these aims: (a) Supplying poor people useful and affordable products with a high poverty alleviation impact, ir (b) Creating a viable business as a private delivery channel, preferably to be run by poor people.

The private sector here should always realize these three key elements in market creation approach to development: (1) Need-based product development – Having focus on high impact on poverty alleviation (with affordability and returns on investment being essentials); (2) The promotion and marketing of these products for the poor to know about their existence; ir (3) Creating a market for these products (To the extent of being viable for the private sector to deliver them as a business). Don’t hesitate to contact me for more information on any related area.

For a start, in order to fit in appropriately, the intended operator must imbibe these to make it work – Being a part of the response to local conditions through identifying opportunities, to come up with solutions, as an agent of change for human development. (Turi būti tęsiama)

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1 komentaras apie "Time for Nigeria’s Private Sector to Get into BOP"

  1. Hello Annie, Nice piece! There is a new wave ofcapitalismgrowing globally which involves business operating profitably through creating opportunities for poor people in the value chain of their core business. This is called inclusive business but I call itSociocapitalism” . I believe it is the way forward especially for developing countries. Some of these models are working in Nigeria but in different shapes and forms with no clear definition. A few entrepreneurs/businesses in Nigeria consciously engage in such models while others consider it business as usual. Hence it seems as though Nigeria is missing in the scheme of things. To an extent we are as many more businesses need to engage in doing pro-poor business. You could check out http://www.businesssinnovationfacility.org for some examples supported by the Business Innovation Facility, Where I work.

    A major challenge however for such models in Nigeria is the inadequate of infrastructure and sustainable policies which contributes to high cost of doing business in Nigeria. However the opportunities such models abound. Manoeuvring this tough terrain to deliver profitable pro-poor business models requires innovation. Innovation does not necessarily connote IT . Simply rethinking current systems and processes within a company with aim of tapping into the huge BOP market in Nigeria, might just trigger an innovation.

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